Is my credit score too good to be true?

[Anonymous]

I am a 23-year-old medical student. I am very, very fortunate to still receive financial help from my parents, and I pay the rest of my bills with student loans. I came to med school straight out of undergrad, so I've never had a *real* job. I have no credit history apart from student loans. I recently realized that I should start building my credit now (should've started 5 years ago, but oh well), so that when I get out into the real world in a few years I will at least have some kind of head start. I've been looking into getting a credit card to buy something small once a month that I would ordinarily pay with debit card and immediately pay off the balance. I was looking into getting something like the Capital One Secured Mastercard. I made an account with Nerd Wallet just to see what my credit score would be with only student loans as my credit history, but I was shocked to see that they listed my credit score as 780! When I looked under payment history, I saw a credit card account with a start date 3 years before I was born. That's my parents' credit card. When I started college, they put me on their account so I would have a way to pay for big car repairs and medical bills without draining my checking account. They pay the bill, not me. I know Nerd Wallet is just a free service, so it may not be an accurate credit score. Would a legit credit service looking at my credit score not be fooled by my parents' credit card account that my name is tagged onto and calculate my credit score differently? If so, how do I figure out what my real credit score is? Or does it even matter? Should I just go ahead and get a secured credit card and start building my credit anyway? Thanks in advance!

[AllZero]

I'm not familiar with nerdwallet. I'm guessing they give out free VantageScore?

You'll need your FICO scores. You can obtain it for $1 at experian.com or creditchecktotal.com. Cancel in 7 days or less to avoid the re-occurring monthly charge.

[Jnbmom]

Get your true FICO scores. Nerd wallet isn’t FICO and your scores could be near that or very different .

[AllZero]

I would not recommend Capital One secured card. Recent data points show they will not graduate.

Did you try Capital One's pre-qual site and see if you received any offers besides the secured card?

I would recommend trying other pre-qual sites such as CITI, Discover, American Express.

One secured card I would recommend is Bank of America $99 deposit with $500 credit line. BoA secured cards can graduate early. They offer soft pull credit limit increases too.

[thornback]

Hi & Welcome to the forums!

Yes, being an authorized user (AU) on your parents' card helps because it gives your file age. However, it's not doing anything to build *your* credit history because you are not legally responsible for the debt. So yes, you should open a card for which you are the primary cardholder - and yes, starting with a secured card is fine. Adding your first card (as a primary) will also yield a score boost.

Your student loans are also helping tremendously by fulfilling the installment portion of your credit mix. I highly recommend paying the interest on your loans while they are in deferment though, if you are not already doing so.

As for scores - Nerd Wallet is providing a score based on the Vantage 3 model which differs from FICO in how it weighs various aspects of your credit and how it responds to changes. Vantage and FICO can vary by as much as +/-100 points on some profiles. You need to monitor your FICO scores as they are what the overwhelming majority of lenders use to make credit decisions.

Based on the info you've provided, I'd guess your FICOs to be in the lower-mid 700s as it is considered young and thin, but clean (no negatives).  You can go to Experian.com and sign up for their 7-day trial to get all 3 FICO 8 scores - just be sure to cancel before the trial ends if you do not want the monthly service.

[mikesonthemend]

Check prequalifications with Chase, Citi, Amex, and Discover. I have three daughters that graduated with better credit than the person that paid their tuition. Most higher education institutions sell student data to banks. They know who they are lending to.

[Anonymous]

Are you an AU on your parents account or did they make you joint? If joint, it’s your account too; if AU it may or may not count depending on the algorithm.

With that said, yes you need to get some credit cards as soon as possible to start your history or expand your history as the case may be. I don’t recommend Credit one or capital one either. I’ve heard good things about Discover secured and other members suggested some above.

But you need a few, maybe you can pick up a BOA, a Citibank and a Discover. You do not want to space these out. You want to get the two or three quickly because when the first one hits your report, it gives notice that you’ve opened accounts to other lenders, which can decrease your chances of further approval.

Although your first couple cards will probably give you an increase, eventually adding a card gives you a decrease for a year.

And it would do you a lot of good to establish a relationship with a credit union and eventually get a credit card with them as well. If you have a path to join Navy federal, I would highly recommend it.

I normally suggest waiting a year between applying for credit cards or sprees. You need a few right now so that they can establish a buffer for your AAOA many years down the line. Make five cards your goal for now. See if you can get 2-3 and then a year from now get another two.

As stated, only FICO scores really matter. And what your scores are right now don’t really matter because you can’t change them, except to make sure the card from your parents reports a small balance between five and $20 before you apply, as that will maximize your score if it is counting.

Good luck to you and welcome.

[Revelate]

It wouldn’t be a joint account, have to be legally responsible for that and can’t be done that early. If the AU counts don’t be surprised if it is a nice score, if it doesn’t it’s probably 680 or lower.

The problem is everyone that matters (lenders / FICO) has been trying to kill AU scoring for years through various things... if you aren’t liable for the debt it isn’t a true reflection of your own risk / responsibility is their thinking.

As a result I agree check the pre-quals with a bunch of lenders, grab 3 credit cards (secured unsecured doesn’t matter) and then just let them age, put some charges on them every so often or be like me / others who literally run their entire financial life through their cards and then just keep paying things in full. I haven’t swiped a debit card other than overseas for cash since I found this forum TBH.

Anyway secured cards are an excellent route but you probably don’t need them OP: you will have some valid score just from the student loans, and in the modern credit market there will be lenders who want to give you credit. There is probably no need to deposit cash to get them to do so honestly but that is a good fallback plan if needed (been a while since I built a credit file but secured cards work for virtually everyone).

[Anonymous]

It wouldn’t have to be done early, you can be added as a joint account anytime (depending on lender) and it still goes from the date of opening. I’ve done it with several.

[Anonymous]

Thanks. I've had a savings account at a local credit union in my hometown (large midwest city) since I was a kid, and I recently opened a CD with them. Should I look into getting my first credit card through them, or just hold that off until later? They don't have a branch in the town I'm currently living in, but as long as I don't physically have to go into the branch that often, it shouldn't be a problem.